ACAS Suspending Dividend
by Nilus Mattive on November 10, 2008
in Consumer Credit News, Dividend Stock
Bad news: American Capital Strategies has also fallen victim to the credit crunch and has decided to suspend its dividend payments.
Obviously, I am extremely disappointed by the news. ACAS has been my favorite high-yield play in the financial sector, and one of the companies that looked best positioned to capitalize on temporary weakness in the credit markets.
The company’s long history of dividend payments also supported my belief that it would continue paying its investors through thick and thin.
I’m still confident that the company will go on to pay out nice dividends in the future. But for now, they think preserving cash is the right approach. Fair enough.
Imagine the same people run AGNC as do ACAS. Take a good read of the above article when you say it wont happen to you, The part left out of the article is the stock lost 97% of its value and has not paid a dividend since. So while all you big shot investors are slapping yourselves on the back just remember. The same boys are in charge of your investment who destroyed thousand of other investment dollars. And for the other group if nit wits that inhabit this board that ask WHY......You dont see any big brokerages recomending this stock. They flat label in unsubstainable and anyone with any sense knows this. PS....You just missed the best trading day in a years only to decline because your company needed more funds to pay your dividend. ..lol
That's cool! A basher bashed by an insomniac English teacher. I try to check most of my spelling and to use proper grammer with correct punctuation, but I say,"Get out the red pen!" You needn't mention the fact the violator in question was also devoid of truth as well. I thank you very much. To a good night's sleep, FOXY
Yeah... Rah! Rah! Rah! The dividend is safe! Rah! Rah! Rah! The spo is complete! Rah Rah! Rah! On the way to Thir-tee!... You should go back 3mths. and check out the same droll from a different set of bashers. Then 3mths before and do the same, and again and again. What's different this time? AGNC is the only game in town with a fresh 1 BILLLLION dollars in order to make money from MBSs. The dividend is safe this quarter and probably the next, and their management didn't even start to invest it yet, management, I may add, that are the best in the bidness. Out of all the stocks in the market to short I think you picked the wrong puppy. The best revenge,it is said, is living well. But sometimes one can't help but to gain satisfaction in another's demise. You sir, are starting to fit that bill. RAH!("One more for the road.")
I have read many cry baby posts like yours when the div gets cut and the pps gets wrapped 70%.
oh class action lawsuit.....i am gonna get a attorney...how could this happen....wh wha wha...your wife might even leave you..oh dang...
your sure a good cheerleader.rah rah sis boom bah.any more cheers??
One could say the same for any company which had real(sic) nice quarters. I guess the whole market is only worth 3 bucks a share. Basher. Seee yooo in De ce'em ber, Seee yooo when you're sad and blue. Will I see you De cem'ber? Or lose you to a margin caalll?
lol....the conviction and dedication are comical. Bear Sterns released real nice quarters also......3 weeks later they were sold for 2 bucks from 30.
Can you spell gullible??You picture is next to it...next cheerleader.
One huge thing to remember is that ACAS was a BDC (business development company) while AGNC is a mortgage REIT. Don't compare apples to oranges because you're not going to fool anyone here.
dividends..both bdc and reits must pay them out
share issuence..both acas and agnc issued them over and over
same management team that ran acas into the ground runs agnc
agnc still pays the div...acas does not. acas did not lower the div....it stopped it.
acas does not issue massive amounts of shares every three months
see the difference...lol
stay at the casino long enough you may walk away with nothing
You are totally right. The same thing is happening again. If the Q4 T.I. is also $1.86, the total that MUST be paid out as a Q4 dividend will be ($1.86+0.85)*(180.7/217.7)*90% =$2.02. If the GAAP profit is also the same, at $1.49, that means they have to pay out 53c/share more than they earned, so book value will go down, and they will have to issue another 50m shares to keep running up the down escalator. By retaining %10 of the T.I., they also have to pay corporation tax on that, so that is another expense. It is impossible to run faster than the escalator is going down when GAAP is lower than T.I. The same thing will happen as happened with ACAS, NEW and NFI
They guys getting the div dont want to hear it. I cant say I blame them but it will hit them like a truck when it happens. The problem is it is a two fold hit. The income stream of the div will be cut or disappear and the pps will take a severe hit.
If your going to play the casino dont slide out more than you can lose.